Third Reich and money issues

Discussions on the economic history of the nations taking part in WW2, from the recovery after the depression until the economy at war.
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Mark in Cleveland, Tn.
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Third Reich and money issues

Post by Mark in Cleveland, Tn. » 28 Jan 2019 01:04

I want to learn something new this week, so bear with me on my request here.
During the bitter end of the TR, like from January 45 , did money-paymentsa for building war supplies- paychecks to civilioans and soldats come into play other than you goona build thes etanks Mr.Company, you gonna fight soldat, bacause our RM's are worthgless and whats the point of you getting paid, as we are in a fight to the death.

Get what I am after?? Was the economy of the TR at the end basically a free no payment economy,?
Give me lots of examples during the end of Germany, thanbks guys

South
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Re: Third Reich and money issues

Post by South » 28 Jan 2019 06:03

Good morning Mark in Cleveland, Tennessee,

I understand what you're after.

I cannot adequately answer it.

I can provide an example - a matter - involving all this.

From 1936 through 1944, money (ie the currency in the domestic German economy and German bank deposits) increased 6 (six) times. Yet, despite this increase in the money, there were - price controls - . Germany finished up the Great War Part 2 with suppressed inflation. The US (officially: "the Allies") kept the Third Reich's price freeze during the occupation. Thus, the inevitable: Goods traded on the black market and via barter because no one wanted the worthless Marks.

From my notes and remembrances: American cigarettes served as a high-quality form of currency. Parker pens and nylon stockings are referenced in this dusty accordion file folder now next to me. A term involving all this was "commodity money".

As an aside, since I mentioned "suppressed inflation";

There's a misinterpretation of events floating around in re this overall subject matter. New industrial investments DURING the end of WWII actually exceeded what was destroyed by the Allies. Thus, correctly, Germany's industrial assets were greater in 1945 - and more modern.
HOWEVER:
In 1947, just 2 years after the war, Germany's industrial production was only ~ 40% of its 1936 level. This is easy enough traced to the still in place price controls.

Again, I'm only providing some info; not adequately answering your question.

I now remember that "Royal Blue" fountain pen ink bottle someone told me was used in barter trade.

Sidebar; A new bout of Global Warming is enroute this week. Stay prepared.

~ Bob
eastern Virginia, USA

cc: General Clay

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Mark in Cleveland, Tn.
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Re: Third Reich and money issues

Post by Mark in Cleveland, Tn. » 02 Feb 2019 02:01

Hmm, interest6ing, during the last year of the war, did the Germans consider their ReichMark worthless, more so after January45?you klnow,, a tank manufacturere had to keep producing tanks for free basically as there was no solid foundation to support the Rm, like we have the Gold Standard to base the dollar on.

South
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Re: Third Reich and money issues

Post by South » 02 Feb 2019 06:42

Good morning Mark,

I cannot answer - can only guess - whether Germans in 1945 war months considered the RM worthless. I know about the postage stamps and their overprints to establish fiat value.

The tank manufacturer was not "pure" private sector.

The last part: no solid foundation for the RM - like we in US had (paste tense) gold standard for the US dollar - I cannot answer. It is a BIG corpus of material with much not in the public domain. I'd love to read any secret annexes to the 1944 Bretton Woods conference.

Much of this 1945 question goes back to the intermission of the Great War. The Reichbank was hesitant to allow businesses, eg a private sector tank manufacturer, to rely on foreign arrangements to pay for domestic German transactions. The Reich forbid this because inflation served as a defacto tax stream.

~ Bob
eastern Virginia, USA

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